HUDSON’S BAY COMPANY SUSTAINABILITY REPORT Hudson’s Bay Company Sustainability Report 2019 2
Founded in 1670, HBC OVERVIEW is the oldest company in
ETHICAL North America. From the SOURCING earliest days, we’ve embraced innovation and adventure, and ENGAGING 3 6 9 OVERVIEW ETHICAL SOURCING ENGAGING OUR PEOPLE learned to change with the OUR PEOPLE 4 Where We Are 7 O ur Approach to times. This tradition continues INVESTING IN OUR Sourcing 10 O ur Approach to today as we commit to meeting Our Approach COMMUNITIES 5 Talent Management our customers’ evolving to Sustainability 8 F actory Audits and CONTRIBUTING Results 11 Diversity and Inclusion needs, while addressing the TO A SUSTAINABLE pressing challenges facing our Learning and Development ENVIRONMENT 11 communities and planet. 12 Health and Well-being UN GLOBAL COMPACT COMMUNICATION OF PROGRESS About This Report In this report, we outline the 2019 sustainability management approaches, highlights and initiatives undertaken in our North American businesses, including Hudson’s Bay, Saks Fifth 13 18 21 Avenue, and Saks OFF 5TH. As a signatory to INVESTING IN OUR CONTRIBUTING UN GLOBAL COMPACT the United Nations Global Compact, this report COMMUNITIES TO A SUSTAINABLE COMMUNICATION also meets our commitment to submit an annual ENVIRONMENT OF PROGRESS Communication of Progress. All dollar amounts 14 Our Approach to Giving are in Canadian dollars, and all performance 19 O ur Approach to data refers to the 2019 calendar year, unless 15 Focus on Mental Health otherwise stated. The 2019 Sustainability Report Environmental is available exclusively online on our corporate 17 Supporting Canadian Stewardship website at hbc.com. Athletes 20 Operational Footprint Hudson’s Bay Company Sustainability Report 2019 3
OVERVIEW
Where We Are
Our Approach to Sustainability
ETHICAL SOURCING
ENGAGING OUR PEOPLE
INVESTING IN OUR COMMUNITIES OVERVIEW CONTRIBUTING TO A SUSTAINABLE ENVIRONMENT HBC is a diversified retailer focused on driving the performance of high-quality stores and 244 stores their omni-channel platforms and unlocking the value of real estate holdings. Founded in UN GLOBAL COMPACT 1670, HBC is the oldest company in North America. HBC’s portfolio today includes formats COMMUNICATION ranging from luxury to premium department stores to off price fashion shopping destinations, OF PROGRESS ~39,000 with nearly 250 stores and approximately 39,000 employees around the world. associates HBC’s leading businesses across North America include Saks Fifth Avenue, Hudson’s Bay, and Saks OFF 5TH. HBC also has significant investments in real estate joint ventures. It has partnered with Simon Property Group Inc. in the HBS Joint Venture, which owns properties in the United States. In Canada, it has partnered with RioCan Real Estate Investment Trust in the RioCan-HBC Joint Venture. Hudson’s Bay Company Sustainability Report 2019 4
OVERVIEW Where We Are Where We Are We serve customers in prime urban and suburban markets Our Approach across North America with nearly 250 stores and our to Sustainability businesses’ digital platforms.
ETHICAL SOURCING
ENGAGING OUR PEOPLE
INVESTING IN OUR COMMUNITIES 89 stores 41 stores Canada 3 Canada / 37 United States CONTRIBUTING TO A SUSTAINABLE thebay.com saksfifthavenue.com ENVIRONMENT
UN GLOBAL COMPACT COMMUNICATION OF PROGRESS
Corporate locations 114 stores 19 offices, distribution 18 Canada / 96 United States centers, call centers saksoff5th.com 8 Canada / 9 United States / 1 Ireland / 1 India hbc.com Hudson’s Bay Company Sustainability Report 2019 5
OVERVIEW Our Approach to Sustainability Where We Are Our approach to sustainability is built around four pillars of action, which are integral to our company and critical for driving the long-term success of our businesses. Through these Our Approach to Sustainability pillars, we enable our associates, customers and vendors to make a positive impact on social Codes of Conduct and environmental issues that matter to us all. The HBC Code of Business ETHICAL Conduct (the Code) and SOURCING Supplier Code of Conduct set out the behaviors we expect of ENGAGING ourselves and of our suppliers. OUR PEOPLE Each year, associates across all businesses receive training on INVESTING IN OUR the Code and related policies COMMUNITIES that are at the core of how we ETHICAL ENGAGING INVESTING CONTRIBUTING do business. They must also CONTRIBUTING SOURCING OUR PEOPLE IN OUR TO A SUSTAINABLE digitally acknowledge that they TO A SUSTAINABLE agree to adhere to these policies. COMMUNITIES ENVIRONMENT ENVIRONMENT We are determined We offer our Training in 2019 included, to build our business associates a wealth of Our company’s success We challenge but was not limited to, basic principles, conflicts of interest UN GLOBAL together with our career development is inextricably linked to ourselves to reduce and associate responsibility. COMPACT suppliers based on and advancement the social and economic our environmental COMMUNICATION the principles of trust, opportunities, and a well-being of our impact, recognizing the OF PROGRESS teamwork, honesty and culture that empowers associates, customers connections between a respect for the rights them to think and act and communities, healthy planet, healthy of others. like owner-operators. and we work to help communities and a them thrive. sustainable future for us all. Hudson’s Bay Company Sustainability Report 2019 6
OVERVIEW
ETHICAL SOURCING
Our Approach to Sourcing
Factory Audits and Results
ENGAGING OUR PEOPLE
INVESTING IN OUR COMMUNITIES ETHICAL CONTRIBUTING TO A SUSTAINABLE ENVIRONMENT SOURCING UN GLOBAL COMPACT COMMUNICATION OF PROGRESS We hold ourselves and our suppliers to high standards of responsible, 711 factories sustainable and socially aware business practices. Ethical conduct, approved for production based on their labor, human rights and environmental protection are the foundation 2019 social compliance audit scores of our Supplier Code of Conduct. We partner with suppliers and industry peers to continually improve working conditions in the ~280,000 factory workers factories that manufacture products on our behalf. covered by HBC’s mandatory social compliance program in 2019 Hudson’s Bay Company Sustainability Report 2019 7
OVERVIEW Our Approach ETHICAL SOURCING to Sourcing Our Approach We believe that we have a responsibility to to Sourcing uphold fundamental human and labor rights, as well as to be mindful of our environmental Factory Audits and Results impact throughout our supply chain. A critical way to ensure our suppliers comply with local ENGAGING OUR PEOPLE laws and the HBC Supplier Code of Conduct is through our mandatory Social Compliance Program. The program applies to all first-tier suppliers producing private label INVESTING IN OUR merchandise for HBC and any non-merchandise items that COMMUNITIES have one of HBC’s company logos, such as shopping bags and gift boxes. CONTRIBUTING TO A SUSTAINABLE To work with HBC, these suppliers are required to ENVIRONMENT disclose the names and addresses of their factories and subcontractors. Since 2014, we’ve been publishing on our corporate website a list of factories that produce private UN GLOBAL brand apparel and home products for us. COMPACT COMMUNICATION Factories must also submit third-party audit reports OF PROGRESS from accredited organizations to demonstrate that their employees are paid a fair wage, their working conditions are safe and clean, and all social and environmental aspects of production and the surrounding communities are Learn more considered. From these reports, we may approve a factory HBC Supplier Code of Conduct for production, approve production subject to required improvements, or decide against or discontinue sourcing HBC Manufacturers List from that factory. California Transparency in Supply Chains Act Disclosure Hudson’s Bay Company Sustainability Report 2019 8
OVERVIEW Factory Audits and Results ETHICAL amfori BSCI Audits commonly observed during audits: social management SOURCING HBC is a long-time member of amfori BSCI (formerly systems, occupational health and safety, fair remuneration known as the Business Social Compliance Initiative), and decent working hours. They are designed to educate Our Approach We accepted 432 a leading supply chain management system that helps factory managers on how to create a fair and equitable to Sourcing companies drive social compliance and improvements work environment for their employees. We strongly believe non-BSCI audit within the factories in their global supply chains. As a that with this knowledge, producers will be able to fix the Factory Audits reports in 2019, member, HBC must adhere to the 11 principles of amfori key issues contributing to violations and improve their and Results long‑term performance. which accounted for 61% of all BSCI’s code of conduct and ensure that our factories are audit reports received. socially responsible. ENGAGING Alternative Audits OUR PEOPLE We encourage our suppliers to use the amfori BSCI social Factories may also submit a third-party audit report auditing methodology, which rates factories on a scale Of the 711 factories produced by an HBC-approved social audit standard, such from A to E, where A is outstanding and E is unacceptable. INVESTING IN OUR as the Social Accountability International (SA8000), approved for We then collaborate with the auditors, vendors and factory COMMUNITIES SEDEX Members Ethical Trade Audit (SMETA) or managers to help implement corrective action plans production, Worldwide Responsible Accredited Production (WRAP). aimed at improving working conditions. Factories that are CONTRIBUTING If a supplier has an internal social compliance program that 63% were located in three issued corrective action plans are re-audited annually or TO A SUSTAINABLE satisfies the requirements of our program, it may submit countries (China, India and biannually to ensure that improvements are made. ENVIRONMENT substitute documentation. These alternative options help Bangladesh) and 69% were For factories rated C or lower, amfori BSCI offers factories alleviate audit costs and reallocate resources to subject to improvements UN GLOBAL free online and in-person capacity-building courses making improvements. being made. COMPACT and workshops. These courses address the issues most COMMUNICATION In 2019, HBC OF PROGRESS amfori BSCI Audited Factory Grades 2019 joined Nirapon to continue developing worker Outstanding 7% empowerment and building safety initiatives that began Good 33% through the Alliance for Bangladesh Worker Safety. Acceptable 220% Learn more at nirapon.org. Insufficient 19% Unacceptable 0% Hudson’s Bay Company Sustainability Report 2019 9
OVERVIEW
ETHICAL SOURCING
ENGAGING OUR PEOPLE
Our Approach to Talent Management
Diversity and Inclusion
Learning and Development Health and Well-being ENGAGING INVESTING IN OUR COMMUNITIES OUR PEOPLE CONTRIBUTING TO A SUSTAINABLE ENVIRONMENT
HBC offers associates rewarding jobs in communities across UN GLOBAL 39,570 associates COMPACT North America and in India – in stores, corporate offices, logistics working in Canada (19,440), the U.S. (19,615) COMMUNICATION and around the world (515) OF PROGRESS and supply chain, or in our call centers. We strive to foster a culture of inclusivity, where our associates feel valued and empowered, and are provided opportunities to learn, grow and achieve their 800,000+ career goals. online modules completed by associates Hudson’s Bay Company Sustainability Report 2019 10
OVERVIEW Our Approach to ETHICAL SOURCING Talent Management ENGAGING To attract, retain and engage the best talent, our people strategies are OUR PEOPLE focused on what matters most to our associates and to our business, namely:
Our Approach to • Providing on-the-job training and Three associate engagement surveys were Talent Management continuous learning conducted in 2019 – one for all associates and two pulse surveys for corporate associates and specific • Offering rewarding career advancement stores. More than 28,600 people completed the Diversity and Inclusion opportunities surveys, providing valuable insight into their level Learning and • Fostering a collaborative culture that embraces of engagement and other dimensions of the HBC Development diversity and inclusion, empowers associates work experience. For the first time, we introduced to think and act like owner-operators, and a diversity index to help measure associates’ sense Building a winning culture Health and Well-being promotes health and well-being of inclusion. Leaders were also given their own “Getting radically better” is a rallying call aimed at team reports from which to develop relevant • Offering competitive benefits that include inspiring HBC associates to embrace change and INVESTING IN OUR action plans. medical, vision and dental for full-time foster a culture of accountability. Five principles COMMUNITIES associates, associate discounts, and the Our overall engagement score of 72 was in the guide our approach to getting radically better: Employee Assistance Program (EAP) average-to-good range compared to other • Be accountable CONTRIBUTING for everyone – full-time and part-time employers. Our lowest score of 70 related to TO A SUSTAINABLE associates alike whether or not associates felt they had the • Fix the fundamentals ENVIRONMENT resources they needed to do their job well. The We prioritize communication as a way of engaging • Keep it simple top two scores related to how well we serve associates and driving our teams and businesses • Fail fast, fail cheap UN GLOBAL our customers: forward. Forums include daily huddles for store • Always be customer champions COMPACT associates, weekly in-person or phone team COMMUNICATION meetings, a weekly e-newsletter for all associates, 85 “Customer needs are the top priority OF PROGRESS in this organization.” In 2019, we worked to embed these principles and quarterly town hall meetings. Engagement deeper into our culture, both through our internal surveys and leader-led focus groups help us gather communications and through our work processes. associate feedback, address workplace issues and 84 “I am empowered to do what is necessary to effectively service Leaders were given talking points for team huddles adapt our people strategies as needed. and were encouraged to lead their teams in finding my customers.” better ways of working. Hudson’s Bay Company Sustainability Report 2019 11
OVERVIEW Diversity Learning and ETHICAL SOURCING and Inclusion Development ENGAGING With customers and associates from around the world, we HBC offers opportunities to learn and grow at every stage OUR PEOPLE want – and need – to reflect the diversity of our stakeholders and of a person’s career. Retail is a great first job for many of our embrace different backgrounds, viewpoints, skills and talents. associates, and we have development programs tailored to their Our Approach to needs. Experienced people, who join us later in their careers, Talent Management In 2019, we conducted a company-wide survey, 38 follow-up focus groups and 20 one-on-one interviews with senior leaders to better understand the current are able to hone their leadership skills, chart new paths or simply Diversity and Inclusion state of our diversity and inclusion (D&I) practices. The learnings are guiding the keep learning. development of a D&I strategy, which will focus on attracting diverse talent, fostering Learning and an inclusive culture, developing diverse leaders, and engaging and celebrating our MyCompass@HBC is a robust talent development approach designed to give Development diverse customers, associates and communities. Among our first steps, we now require associates and their leaders a clear and simple way to track career goals, growth and that the shortlists provided by search firms recruiting executives on our behalf include success. Training ranges from a selection of more than 6,000 e-learning courses that Health and Well-being diverse candidates. associates can access at a time and place that suits them, to structured, instructor-led leadership development programs. INVESTING IN OUR Additionally, our Employee Resource Groups (ERGs) are associate-led networks LinkedIn Learning was a new addition to our training curriculum in 2019, giving COMMUNITIES composed of individuals who join together based on common interests, backgrounds or demographic factors. They organize networking events, speaker series, professional associates free access to another 16,000 online courses for developing their technical, development workshops and other events for their members. We have seven ERGs in soft and leadership skills. We ran a communication campaign encouraging people CONTRIBUTING total, four of which are geared to women. to sign up for courses, which helped boost registrations, particularly among our TO A SUSTAINABLE Bangalore-based associates. ENVIRONMENT
UN GLOBAL COMPACT COMMUNICATION OF PROGRESS
2019 801,180 191,787 e-learning modules training hours totals completed completed Hudson’s Bay Company Sustainability Report 2019 12
Safety OVERVIEW Health and We take all reasonable care to prevent injuries through hazard recognition, risk ETHICAL assessment and control, regular communication, active associate involvement, SOURCING Well-being and continuous improvement of systems, procedures and training. Should an accident occur, it is investigated to identify the root cause and corrective actions ENGAGING We know there’s a strong connection between are implemented. OUR PEOPLE associates’ health and well-being and their ability to do their best work. We want our associates to Our Approach to In Canada Talent Management make their health and safety a priority, and we take a holistic approach that supports their physical, Diversity and Inclusion emotional, social and financial well-being. 8% 9% reduction in claims increase in lost-time Learning and In addition to medical and dental benefits for full-time associates, reported claims Development we offer work/life programs that provide greater flexibility in how associates manage their time. This includes flexible paid time off for Health and Well-being corporate and distribution center salaried associates, and varying leaves of absence. 90 of 119 61 of 119 INVESTING IN OUR As part of our commitment to destigmatizing mental health and COMMUNITIES (76%) (51%) supporting access to care, we organize workshops, panels and forums of locations achieved of locations achieved a to create a safe place for dialogue on this critical societal issue. In CONTRIBUTING 100% compliance for full year without a addition, more than 400 associates have volunteered to be mental monthly Health & Safety lost-time injury TO A SUSTAINABLE health ambassadors and have been trained to support engagement ENVIRONMENT committee meetings and across our company. workplace inspections In select Canadian locations, associates were offered one-on-one UN GLOBAL consultations and group workshops aimed at helping them become COMPACT more financially prepared. COMMUNICATION In the United States OF PROGRESS 8,800+ 10% active Canadian associates participate in the reduction in Workers’ Compensation claims, HBC Retirement & Savings Program, and benefit including 21 fewer lost-time claims from the company’s contribution to the program, which totaled over $12 million in 2019. Hudson’s Bay Company Sustainability Report 2019 13
OVERVIEW
ETHICAL SOURCING
ENGAGING OUR PEOPLE
INVESTING IN OUR COMMUNITIES
Our Approach to Giving
Focus on Mental Health
Supporting Canadian INVESTING IN OUR Athletes
CONTRIBUTING TO A SUSTAINABLE COMMUNITIES ENVIRONMENT
UN GLOBAL COMPACT Community has always been at the core of COMMUNICATION $1,267,932 CAD $ 1,628,435 CAD OF PROGRESS who we are. Our stores are an integral fixture donated by the Canadian in corporate donations made by HBC and of neighborhoods across North America and HBC Foundation customer fundraised dollars in Canada a majority of our associates live nearby. We recognize that the health of our company $1,201,474 USD $1,451,884 USD is inextricably tied to the health and vitality donated by the U.S. HBC Foundation* in customer fundraised dollars in the U.S. of our communities, and we do all we can to * The HBC Foundation in the United States has been renamed the Saks Fifth Avenue Foundation, beginning support them. January 2020. Hudson’s Bay Company Sustainability Report 2019 14
OVERVIEW Our Approach to Giving ETHICAL We’re proud to invest in the communities where we work and live. Our giving programs – SOURCING which include the work of our foundations as well as our corporate donations, fundraising and volunteering – promote health and well-being and tackle critical social issues. ENGAGING More than OUR PEOPLE Both the Hudson’s Bay Foundation in Canada and the In addition to its mental health focus, the Hudson’s $6 million CAD Saks Fifth Avenue Foundation (formerly known as the HBC Bay Foundation has a longstanding partnership with distributed to mental health INVESTING IN OUR U.S. Foundation) in the United States have made mental the Canadian Olympic Foundation and the Paralympic needs over three years COMMUNITIES health a top priority since 2017. They recognized then, Foundation of Canada, and has delivered more than as they do today, that mental illness prevents too many $50 million CAD since 2006. Our Approach to Giving North Americans from living their best lives. 500,000+ people Focus on Mental Health Together, HBC and the Foundations pledged to distribute $6 million CAD to mental health needs in communities reached with mental health and reach at least 500,000 people through mental services, support and education Supporting Canadian over three years Athletes health services, support and education over three years. Both goals were exceeded by the end of 2019. This CONTRIBUTING success was achieved through partnerships with best-in- TO A SUSTAINABLE class organizations working to deliver innovative mental ENVIRONMENT health programs that could be implemented locally and achieve national scale. These partners provided us with annual impact reports to help assess the effectiveness of UN GLOBAL our investments. COMPACT COMMUNICATION While mental health will remain a priority in 2020 and OF PROGRESS beyond, both Foundations will refocus their mandates slightly. In Canada, the Hudson’s Bay Foundation will focus on equipping more Canadian families to support positive mental health at home, and on closing the gender gap in mental health. In the United States, the Saks Fifth Avenue Foundation will target specific communities that are uniquely affected by mental health issues – namely, LGBTQIA+, youth, women and communities of color. Hudson’s Bay Company Sustainability Report 2019 15
Hudson’s Bay Foundation (Canada) OVERVIEW Focus on ETHICAL SOURCING Mental Health Hudson’s Bay Foundation granted $1.25 million over Beginning in 2017, Hudson’s Bay Foundation is three years (starting in 2018) to support the Centre donating $500,000 over three years to CAF to ENGAGING Mental health issues are increasingly for Addiction and Mental Health’s Game Changers provide youth transitioning out of foster care with the OUR PEOPLE prevalent across North America. In fact, the Program, a national mental health education and urgent mental health support needed to improve their Centers for Disease Control and Prevention prevention program designed to reach students overall physical and psychological well-being. The intent INVESTING IN OUR (CDC) cites that one in five Americans across Canada and help young Canadians feel more is to help at least 738 youth over the three years. COMMUNITIES comfortable talking about mental health, seeking help experiences a mental illness in any given year. for themselves, and supporting friends in need. Our Approach to Giving While many mental health concerns can be Resources include a conversation starter guide managed with treatment, studies show that adapted for youth, a self-care toolkit and a mental Focus on Mental Health shame, stigma and secrecy often prevent health 101 online tutorial. The program also involves workshops held across the country at high schools in Supporting Canadian people from seeking the help they need. rural and urban communities. The target is to reach Athletes Envisioning a world where mental health is as unstigmatized more than 334,000 youth through the online and in‑person programming. CONTRIBUTING as the common cold, our Foundations embarked on a In October 2019, Hudson’s Bay stores TO A SUSTAINABLE journey in 2017 to address mental health issues across ENVIRONMENT North America, focused on: partnered with Leesa Sleep, a mission- driven premium mattress company, • Increasing awareness and education – by fostering to donate 500 mattresses to families UN GLOBAL conversation and understanding through educational training and global communication campaigns and individuals served by the Canadian COMPACT Mental Health Association, along with a COMMUNICATION • Improving access to care – by providing funding to $25,000 donation. OF PROGRESS increase the availability of accessible resources and treatment programs for youth, teens and adults in every community The Game Changers resources are • Supporting overall well-being as a contributor to mental “designed by youth with lived experience wellness – by reinforcing the intersection of physical and of mental health challenges. Because of mental health as a crucial factor in the overall well-being of this, I believe they have real potential individuals and families to help youth start and continue conversations around mental health We not only achieved our own three-year quantitative and self-care.” targets in 2019, but also established partnerships and supported programs that are changing lives forever. Em Hayes, Game Changers advisor and CAMH youth engagement facilitator Hudson’s Bay Company Sustainability Report 2019 16
The Saks Fifth Avenue Foundation OVERVIEW (United States) The Saks Fifth Avenue Foundation donated nearly ETHICAL $1 million USD to support mental health organizations NAMI is the largest grassroots organization dedicated NewYork-Presbyterian’s Youth Anxiety Center advances SOURCING and reached 1.6 million people with messages that to building better lives for Americans affected by mental effective ways of diagnosing, treating and helping teens combat the shame and stigma surrounding mental illness. Each year, the organization hosts NAMI Walks, and young adults suffering from anxiety disorders ENGAGING health struggles in 2019. which are the largest, most prominent mental health through research, treatment and education. Through OUR PEOPLE education and fundraising walks in the U.S. Proceeds the support of the Saks Fifth Avenue Foundation, the Cyndi Lauper headlined a cocktail fundraiser held at from the walks fund education, advocacy and support Youth Anxiety Center was able to further its work in L’Avenue at Saks in New York City in May 2019, which services for those impacted by mental illness. In 2019, providing treatment services to young people and their INVESTING IN OUR raised $2.2 million USD in support of the Saks Fifth the Saks Fifth Avenue Foundation supported NAMI families to facilitate the transition to adulthood and COMMUNITIES Avenue Foundation’s mental health mission. In 2019, the 5K Walks across the country to raise awareness for help them create the lives they want to live. Foundation supported the following partners: Our Approach to Giving mental health.
Focus on Mental Health bring change to mind Supporting Canadian Athletes let’s talkFounded mental by health Glenn Close, Bring Change to Mind strives The Jed Foundation is a non-profit that exists to protect Columbia University Department of Psychiatry is a CONTRIBUTING to end the stigma and discrimination surrounding mental emotional health and prevent suicide for our nation’s leader in understanding mental health and mental illness. TO A SUSTAINABLE illness. The organization has launched student-led teens and young adults. In 2019, the Saks Fifth Avenue The Saks Fifth Avenue Foundation supported three ENVIRONMENT mental health clubs in high schools to provide a safe Foundation awarded a grant to JED that was used to research programs on depression and mood disorders in space for educated conversation about these issues. support scholarships for schools to join JED Campus – 2019. These funds enabled Columbia Psychiatry to make UN GLOBAL Together with the New York City Mayor’s Office, a nationwide initiative designed to help guide colleges game-changing advances in the diagnosis and treatment COMPACT Bring Change to Mind wanted to scale this program and universities through assessing and building upon of depression and apply those advances to the care of COMMUNICATION to local schools with a pilot launch in fall 2019. The their existing student mental health, substance abuse patients through their clinical enterprise. OF PROGRESS Saks Fifth Avenue Foundation’s grant funded staff in and suicide prevention efforts. The Saks Fifth Avenue New York City, high school club activities, evaluation of Foundation’s grant helped JED expand its program to the pilot and a regional meet-up for club members. more college campuses nationwide. Hudson’s Bay Company Sustainability Report 2019 17
OVERVIEW Supporting Canadian ETHICAL SOURCING Athletes ENGAGING Along with being the Official Outfitter of the Canadian Olympic OUR PEOPLE Team from 2013 to 2020, we support individual athletes through partnerships with the Canadian Olympic Foundation and the INVESTING IN OUR COMMUNITIES Paralympic Foundation of Canada. The HBC Foundation committed to investing $2.5 million CAD between 2016 and 2020 to Our Approach to Giving help Canadian Olympic athletes through its Athlete Bursary Program. The program awards 50 athletes $10,000 per year for five years toward activities that benefit their development Focus on Mental Health and mental well-being. Supporting Canadian The Foundation also donated more than $15,000 CAD to the Paralympic Foundation of Partners for Change Athletes Canada in 2019 to help athletes with disabilities get involved in sports, nurture their overall well-being, and compete on the world stage. HBC vendors, partners, customers and associates amplify our CONTRIBUTING impact through their willingness to support social causes that TO A SUSTAINABLE are important to us all. In 2019, the HBC Foundation Golf ENVIRONMENT The support from Hudson’s Bay has been Tournament & Spa hosted almost 650 vendor partners, HBC “remarkable. It’s hard to put it into words, having associates and Olympic and Paralympic athletes at its annual UN GLOBAL that steadfast support from such an iconic and fundraiser. With proceeds supporting Canadian Olympic athletes and our mental health partners, CAMH and CAF of COMPACT truly Canadian brand as Hudson’s Bay. Over the COMMUNICATION Canada, the event raised more than $1.35 million CAD and OF PROGRESS last couple of years, I have used this bursary for brought the total to more than $13 million since 2001. different forms of training, outside of my team’s scheduled training.” $404,731 CAD A dual-season Olympian, Georgia Simmerling made history when she became the first Canadian to raised for the Canadian Olympic Foundation compete in different sports at three separate Olympic through the sale of Hudson’s Bay’s iconic Red Games. An alpine skier at Vancouver 2010, she was a Mittens in 2019 (a non-Olympic year). Since ski cross racer at Sochi 2014, and then a track cyclist their launch in 2009, the mittens have raised at Rio 2016 where she won bronze in team pursuit. more than $33 million CAD. Hudson’s Bay Company Sustainability Report 2019 18
OVERVIEW
ETHICAL SOURCING
ENGAGING OUR PEOPLE
INVESTING IN OUR COMMUNITIES
CONTRIBUTING TO A SUSTAINABLE CONTRIBUTING ENVIRONMENT
Our Approach to Environmental TO A SUSTAINABLE Stewardship Operational Footprint ENVIRONMENT UN GLOBAL COMPACT COMMUNICATION OF PROGRESS With our planet under increasing strain, we strive to reduce our 57% environmental impacts and enable our customers to do their part waste diversion rate in 2019 as well. Our committed actions today can protect the planet for tomorrow, and this is important to every one of us. 30% increase in owned-brand products designed and made with the Earth in mind Hudson’s Bay Company Sustainability Report 2019 19
OVERVIEW Our Approach to Environmental Stewardship ETHICAL As a large retailer, we recognize our responsibility in the fight against climate change, plastic pollution and nature loss. At a minimum, SOURCING we comply with the environmental laws and regulations that apply to us – which includes meeting increasingly rigorous requirements in jurisdictions that, for example, have banned plastic bags or the disposal of foam packaging. ENGAGING OUR PEOPLE Beyond that, we focus largely on making operational With growing concerns worldwide about plastic pollution, We engage environmental consultants to help us improvements that increase energy efficiency, decrease we have stepped up our efforts to divert plastic waste. collect and evaluate relevant environmental data from INVESTING IN OUR water consumption, generate less waste, reduce This has included creating branded reusable shopping our operations. As the data collection methodologies COMMUNITIES greenhouse gas (GHG) emissions – and help us bags to cut down on the number of single-use plastic become more robust, we will use the information to set reduce costs. Waste diversion in particular has been an bags given to customers. We’re assessing additional meaningful reduction targets, identify opportunities for CONTRIBUTING operational focus. HBC participates in recycling councils ways to reduce the plastic packaging our customers improvement, and track and report our progress. TO A SUSTAINABLE across North America and collaborates with companies take home with them, while continuing to protect the ENVIRONMENT working in the recycling sector to find innovative products they buy. solutions to our waste management challenges. Our Approach to Environmental Stewardship
Operational Footprint
UN GLOBAL COMPACT Purchases with Purpose COMMUNICATION OF PROGRESS We work closely with our vendors to help customers find products that are designed and made with the environment in mind. The Hudson’s Bay website (thebay.com) now has Purchases with Purpose, a shop offering products that support social and environmental consciousness. In 2019, we increased our assortment of owned-brand products made with materials that create less environmental impact – like organic cotton and recycled flannel – by almost 30%. We plan to continue growing our array of purpose-driven products in 2020, and will begin to look at measuring their social and environmental impacts both in our supply chain and at the end of their product life. Hudson’s Bay Company Sustainability Report 2019 20
Recycling Highlights OVERVIEW Operational (2019 vs. 2018) ETHICAL SOURCING Footprint 66% 65% increase in metal increase in paper recycling ENGAGING Diverting waste from landfill through materials recycling OUR PEOPLE recycling or reuse is an ongoing priority, toward a 2030 goal of diverting 80% of all INVESTING IN OUR COMMUNITIES waste generated in our stores, distribution 100 tonnes ≈ 9 tonnes centers and offices. While our 2019 waste of plastic hangers were recycled of bags, wrappers and other at our Etobicoke, ON Distribution CONTRIBUTING diversion rate was 57%, down from 61% soft plastics were diverted Centre, an increase of more than TO A SUSTAINABLE in 2018, overall waste tonnage was 10% from Hudson’s Bay stores in ENVIRONMENT 20 tonnes compared to 2018. 2019, compared to just one less – meaning we generated less waste The recycled hangers are turned tonne in 2018. Our Approach to to begin with. into new products. Environmental Stewardship Each year, we look for opportunities to reduce our energy use, primarily by optimizing our heating, ventilation and air Total Waste by Stream (Mt) Operational Footprint conditioning (HVAC) systems, upgrading to more energy- efficient LED lighting, and improving operational practices. 22.55072 22.55 Appliance UN GLOBAL LED lighting retrofits were completed in eight Saks OFF 5,339.03 Cardboard 5TH stores in 2019. COMPACT 5339.025 64.38 Furniture COMMUNICATION We set a goal of reducing company-wide absolute GHG 2.13 Glass OF PROGRESS 64.38 emissions by 10% by 2020 using a 2014 baseline, and are 101.06 Hangers on track to meet that, having already achieved 8%2.132849 as of January 2019. We are reviewing our operations and will 161.79 Mattress reassess our GHG goals and targets in 2021. 101.0616 75.84 Metal 161.79 391.39 Organics 32.63 Paper 75.84445 123.60 Plastic 391.3851 815.75 Single Stream 3.91 Styrofoam 32.63372 1,991.41 Wood 123.6048 9,125.48 TOTAL 815.7505 3.907443 1991.412 Hudson’s Bay Company Sustainability Report 2019 21
OVERVIEW UN Global Compact Communication of Progress ETHICAL As a participant in the UN Global Compact, HBC has agreed to operate in ways that, at a minimum, meet fundamental SOURCING responsibilities in the areas of human rights, labor, environment and anti-corruption. This is our second UN Global Compact Communication of Progress, which details the work we’ve done and plan to do to embed the UN Global Compact’s Ten Principles ENGAGING OUR PEOPLE for business into our strategies and operations.
INVESTING IN OUR PRINCIPLE APPROACH, ACTIONS AND OUTCOMES COMMUNITIES 1. Supporting and respecting the protection of The company has an ethical sourcing policy and process, and membership in amfori BSCI. internationally proclaimed human rights CONTRIBUTING 2. Making sure businesses are not complicit in human Suppliers are required to disclose all factories as a condition of doing business. TO A SUSTAINABLE rights abuse ENVIRONMENT Human Rights 3. Upholding the freedom of association and Suppliers must abide by their country’s laws/regulations and comply with the HBC Supplier and amfori BSCI UN GLOBAL the effective recognition of the right to Codes of Conduct. COMPACT collective bargaining COMMUNICATION 4. Eliminating all forms of forced and compulsory As a member of amfori BSCI, suppliers are required to participate in training/education on how to eliminate OF PROGRESS Labor labor forced labor, if any exists within their operations and activities. 5. Effectively abolishing child labor As a member of amfori BSCI, suppliers are required to participate in training/education on how to eliminate forced labor, if any exists within their operations and activities. 6. Eliminating discrimination in respect of As a member of amfori BSCI, suppliers are required to participate in training/education on how to eliminate employment and occupation discrimination (e.g., age, caste, disability, language, nationality, racial or ethnic, regional, religious, gender, sexual orientation), if any exists within their operations and activities. 7. Supporting a precautionary approach to Suppliers are assessed for their environmental management practices prior to production and during a social environmental challenges compliance audit. 8. Undertaking initiatives to promote greater Corporately, HBC has strategies to reduce energy use, single-use plastic bags and greenhouse gas emissions. environmental responsibility We have seen reductions in these areas and will continue to implement strategies and targets. We also implement Environment strategies to manage water consumption. 9. Encouraging the development and diffusion of For consumers, HBC continues to expand and explore products that are made with recycled or organic materials. environmentally friendly technologies 10. Working against corruption in all its forms, The company has an associate Code of Conduct that all associates must review and sign each year. At a supplier including extortion and bribery level, all supplier agreements state a zero-tolerance for corruption in all its forms. Supplier education is provided by way of the social compliance program, and associate education by way of internal online training. To date, HBC has not had any reported anti-corruption incidents. Anti-corruption hbc.com thebay.com saks.com saksoff5th.com